Nifty 50 has come down in the early trades. The index is down 0.3 per cent and is currently trading at 25,560. The advances/declines ratio is at 21:29. This is negative as of now. If this trend continues then there can be more fall during the day.
Nifty 50 outlook
Nifty will have intraday resistance in the 25,600-25,650 region. A strong break above 25,650 is needed to resume the upmove towards 25,800 and higher.
As long as the index stays below 25,650, there are chances to see a corrective fall in the next few sessions. A fall to 25,450-25,400 is possible.
However, after this fall, the broader uptrend can resume breaking above 25,650.
So, broadly, the outlook is bullish to see a rise to 25,800 and higher. Whether this rise is going to happen from here itself or after a corrective fall is not clear as of now.
Nifty 50 futures
The Nifty 50 July futures (25,708) is down 0.15 per cent. The contract is facing resistance around 25,800 for now. That keeps alive the chances of seeing a corrective fall to 25,600 first before the broader upmove resumes.
A decisive break above 25,800 can take the Nifty 50 July futures contract up to 26,000 in the near term. This rise is the most preferred move for the contract. This rise can happen either from here itself or after a dip to 25,600.
Trade strategy
Positional trades can be considered at the moment. Wait for dips. Go long at 25,660 and 25,620. Keep the stop-loss at 25,520. Trail the stop-loss up to 25,690 as soon as the contract goes up to 25,760. Move the stop-loss further up to 25,780 and 25,860 when the contract touches 25,820 and 25,930 respectively. Exit the long positions at 25,980.
Please note that this trade can be held for the whole of this week.
Supports: 25,600, 25,500
Resistances: 25,800, 26,000